While rising home prices and stubbornly high mortgage rates continue pushing the dream of homeownership out of many Americans’ reach, soaring insurance premiums are making it harder for homeowners in disaster-prone parts of the country to hold on to the properties they already have.

In tornado-swept states such as Nebraska and Oklahoma, home insurance takes up nearly a fifth of monthly housing costs, accounting for a bigger share than mortgage payments and property taxes, according to a new study by personal finance website LendingTree.

Overall, home insurance takes up at least 10 percent of monthly housing costs in 20 states.

How Insurance Premiums Are Contributing to the Housing Affordability Crisis

Experts believe we are now living through “unprecedented times” when it comes to the current U.S. housing market, which remains largely frozen as home prices continue rising, borrowing costs remain historically high, and parts of the country have seen a deluge of inventory while others are facing acute shortages.

Since 2020, when historically low mortgage rates sparked a home-buying frenzy across the country, home prices jumped by 54 percent nationwide, according to the latest data by Harvard University’s Joint Center for Housing Studies (JCHS). Mortgage rates went from lows of 2 to 3 percent to highs of 6 to 7 percent following the Federal Reserve’s rate-hiking campaign to lower inflation in 2022, and are now hovering around the 6.5 percent mark.

Meanwhile, property taxes have risen in steps with home values, surging by over 30 percent between 2019 and 2025, according to JCHS, and in states like Florida homeowner associations (HOA) fees have climbed following the implementation of new building safety laws.

All these hikes have made homeownership more expensive and difficult to achieve for tens of thousands of Americans. But there is another key factor playing into the current housing affordability crisis: home insurance.

Premiums have been rising steadily for years now, as more frequent and more severe extreme weather events have been posing a growing risk to insurers at the national level. In disaster-prone states like Florida and California, additional factors—such as widespread fraud and excessive litigation for the first and strict regulations for the second—made it even harder for insurers to keep their business profitable in the face of likely higher expenses.

While lawmakers in Washington have raised alarm over the situation and both Florida and California have intervened to stop an already-unfolding exodus of private insurers from their markets, premiums have continued increasing over the past couple of years.

Between 2019 and 2025, the country’s average monthly insurance premiums increased by 72 percent to $201, according to JCHS.

Where Homeowners Spend More on Insurance Than Mortgages and Property Taxes

At the national level, home insurance makes up 8.5 percent—or $200 a month—of the typical monthly housing costs for homeowners with a mortgage, according to LendingTree analysis. That assumes an estimated monthly mortgage payment of $1,843 and an estimated monthly property tax of $300.

But in states with higher weather risks, nearly one in every five dollars that homeowners spend on housing goes to their home coverage.

These are the 10 states where home insurance accounts for the largest share of monthly housing costs, according to LendingTree:

1. Nebraska: 19.4 percent ($413 a month)
2. Oklahoma: 17.6 percent ($278 a month)
3. Texas: 14.4 percent ($331 a month)
4. Arkansas: 14.0 percent ($200 a month)
5. South Carolina: 13.5 percent ($259 a month)
6. Tennessee: 13.4 percent ($284 a month)
7. Colorado: 13.3 percent ($463 a month)
8. South Dakota: 13.3 percent ($272 a month)
9. New Mexico: 13.0 percent ($244 a month)
10. Alabama: 12.3 percent ($182 a month)

“Nebraska, Oklahoma and Texas all have severe wind and hail risks, and Texas homeowners face additional threats from hurricanes and even wildfires, depending on their location,” Rob Bhatt, LendingTree insurance analyst and licensed insurance agent, said in a statement. “Insurance companies in these states have priced the potential costs of these types of disasters into their rates.”

Home insurance also accounts for at least 10 percent of monthly housing costs in Kansas (12.2 percent), Kentucky (12.1 percent), Mississippi (11.9 percent), North Dakota (10.9 percent), Virginia (10.6 percent), Iowa (10.6 percent), North Carolina (10.3 percent), West Virginia (10.2 percent), Montana (10.1 percent), and Georgia (10.0 percent).

These are the 10 states where home insurance accounts for the smallest share of monthly housing costs:

1. Hawaii: 2.1 percent ($95 a month)
2. Vermont: 3.2 percent ($77 a month)
3. District of Columbia: 3.5 percent ($145 a month)
4. New Hampshire: 3.6 percent ($114 a month)
5. California: 3.8 percent ($170 a month)
6. New Jersey: 4.3 percent ($159 a month)
7. Alaska: 4.5 percent ($113 a month)
8. Delaware: 4.6 percent ($97 a month)
9. Maine: 4.8 percent ($107 a month)
10. Washington: 4.9 percent ($178 a month)

How Home Insurance Will Reshape the Country

Home insurance premiums are expected to rise for the fifth consecutive year by the end of 2026, reaching an average of $3,057, according to insurance comparison website Insurify.

Higher premiums are likely to have a dramatic impact on homeownership across the U.S., according to the Urban Institute, potentially leading to underinsured communities in vulnerable areas of the country, especially in the case of homeowners without a mortgage.

Based on data by the Chicago Fed, between 2007 and 2017—before the recent premium hikes—6 percent of all U.S. homeowners lacked insurance on their property. Researchers found that Black and Hispanic homeowners were most likely to be in the uninsured group, and years of education, income, and home value were all positively correlated with having homeowners insurance.

Similarly, a more recent report by the Urban Institute found that the burden of home insurance falls hardest “on lower-income households, on communities in hazard-prone areas, and increasingly on markets where the relationship between peril risk and cost is anything but straightforward.”

In short, this is a crisis that is likely to hit the most vulnerable members of America’s communities and, as much as it affects the entire country, will be felt first in the parts of the country that are already known to be prone to natural disasters.

But there is also a glimpse of good news coming from the latest data: “after double-digit increases in 2023 and 2024, rates only grew by 6 percent last year,” Bhatt said.

Contact Newsweek editors on this story: Matthew Robinson and James Debens